Nigeria seeks crypto clarity one year into Tinubu’s tenure

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There has been a mix of hope and concern for Nigeria’s crypto industry. Stakeholders in the sector have stated that President Bola Tinubu’s government’s actions and policies have left the industry without clarity in the past year. 

In his campaign manifesto, Nigerian President Tinubu pledged to legalize crypto and blockchain technology for the country’s banking and finance sector. This decision was approved due to its potential to strengthen Nigeria’s fragile economy.

Opinions on Tinubu’s past year

However, the young population in Nigeria now feels more bewildered by the administration’s recent actions against the country’s crypto industry. In a statement shared with Cointelegraph, Olumide Adesina, an analyst at Quantum Economics, said there is a need for clarity and support to unlock the sector’s potential.

Adesina emphasized that recent actions, including the crackdown on peer-to-peer (P2P) trading, the arrest of a Binance executive and accusations of currency manipulation by state officials, have temporarily cast the industry in a negative light. This is despite the high level of interest from the country’s young and dynamic population.

Nathaniel Luz, the CEO of Flincap, a liquidity platform for crypto exchanges, emphasized that President Tinubu has a unique opportunity to shape Nigeria’s emerging crypto sector, much like previous leaders did with the banking industry.

Luz stated that the crypto industry is maturing, and it is up to President Tinubu to decide how to proceed. Luz maintained that the administration has not done enough, and more action is expected.

Crypto policies in the past year

In May 2023, the Nigerian Securities Exchange Commission (SEC) published regulations for digital assets, suggesting the authorities were seeking a middle ground between a ban and a lack of regulation.

In December, the Nigerian SEC lifted its ban on banks operating accounts for crypto service providers, and the central bank stated that global trends suggested a need to regulate the activities of VASPs, which include cryptocurrencies and assets.

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In January, the Central Bank released initial guidelines for banks opening cryptocurrency accounts, but banks’ ability to trade or hold virtual assets within their own portfolios remains banned.

The guidelines include stringent Anti-Money Laundering (AML), Know Your Customer (KYC) and other measures. Plus, banks must set what is described as “prudent” transaction limits and not allow cash withdrawals from crypto accounts.

In May 2024, the government of Nigeria began preparing to introduce new regulations banning P2P cryptocurrency exchanges using the national currency, the Nigerian naira.

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